Question

Calculate Liquid Assets and Quick Ratio of the Company.

• A. Rs 60,000 ; 0.6 : 1
• B. Rs 1,00,000 ; 1 : 1
• C. Rs 1,60,000 ; 1.6 : 1
• D. Rs 2,60,000 ; 2.6 : 1

Hint:

Quick ratio measures immediate liquidity by excluding inventory from current assets.

Answer 1

The Correct Option is A

Step 1: Calculate Liquid Assets

Liquid Assets = Current Assets − Inventory

= ₹1,60,000 − ₹1,00,000 = ₹60,000

Step 2: Calculate Quick Ratio

Quick Ratio = Liquid Assets / Current Liabilities = ₹60,000 / ₹1,00,000 = 0.6 : 1